Chapter 23: Reflections on the NDRC case against China Telecom and China Unicom
On 9 November 2011, the News 30' programme on CCTV – the Chinese national television broadcaster – reported that China Telecom and China Unicom were under investigation by the NDRC for suspected anticompetitive conduct in the broadband access market in China. The basic view of the antitrust authority in this case was that China Telecom and China Unicom had used their dominant position in the broadband access market to charge competitors high fees for Internet access, with a significant negative impact on fair competition in the broadband access market. If the evidence is solid and the facts are found to be accurate, the two enterprises may face fines of hundreds of millions or even over a billion CNY. Indeed, Article 47 of the Anti-Monopoly Law provides that a company in violation of the law shall be fined between 1 and 10 per cent of its total turnover in the preceding year. Over a year has passed since the CCTV broadcast. During this period, no significant progress was made in this case, except for statements on 2 December 2011 on the websites of the two companies under investigation. These statements claimed that the companies had submitted to an NDRC application to stop the investigation, and that they had undertaken to ‘rectify’ their conduct (in other words, bring it into compliance with the law). About a year later, in December 2012, Xu Kunlin, the Director-General of the NDRC's Price Supervision and Anti-Monopoly Bureau, discussed this case during a conference.
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